3 ms·

Why don't startups list valuations along with funding amounts to the press?

• cfarm 7y ago
  When they get big enough they do. Depends on what you consider a startup.
  • naveen99 7y ago
    Yeah, I am just trying to understand the reasoning. Is it the founders or the investors who benefit more from the half hearted secrecy ?
    • cfarm 7y ago
      IMO I don't think anyone benefits from announcing the valuation.
      • naveen99 7y ago
        Other potential investors would benefit from knowing the valuation, and if they invest then maybe founders and earlier investors benefit, no ? What’s the benefit from announcing the funding amount ?
        • cfarm 7y ago
          I think funding amount could attract a specific type of talent.
• icedchai 7y ago
  Just multiply the latest funding by 4x or 5x. That'll get you close-ish.
  • e1g 7y ago
    This is a useful estimation formula, and I'm not sure why you're getting downvoted. The reasoning is as follows: institutional investors prioritize ownership % over $. For the first couple financing rounds, they will want 15-25% of the business and will increase the check size until they get that. If they get 25%, post-money valuation of the business is 4x the investment. If they get 20%, post-money = 5x the amount. There are outliers, but "post-money = 4-5x the check size" is a useful heuristic for mid-market deals.
    • icedchai 7y ago
      Thank you! Yes, in my experience, "most investors want 20% in each round" has been a good rule to go by...
• return1 7y ago
  Because they are not forced/required to. You can find that data in databases like crunchbase i think